Question
The Bartlett Manufacturing Company's costing system has two direct-cost categories: direct materials and direct manufacturing labor. Manufacturing overhead (both variable and fixed) is allocated to
The
Bartlett
Manufacturing Company's costing system has two direct-cost categories: direct materials and direct manufacturing labor. Manufacturing overhead (both variable and fixed) is allocated to products on the basis of standard direct manufacturing labor-hours (DMLH). At the beginning of
2020,
Bartlett
adopted the following standards for its manufacturing costs:
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Part 1
Requirement 1. Prepare a schedule of total standard manufacturing costs for the
8,400
output units in January
2020.
Direct materials |
|
---|---|
Direct manufacturing labor |
|
Variable manufacturing overhead |
|
Fixed manufacturing overhead |
|
Total |
|
Part 2
Requirement 2. For the month of January
2020,
compute the variances, indicating whether each is favorable (F) or unfavorable (U).
Before computing the variances complete the tables below. Begin by completing the table for direct materials.
|
|
|
| |
|
| Actual Input Quantity Budgeted Price |
| |
---|---|---|---|---|
| Actual Costs Incurred | Purchases | Usage | Flexible Budget |
Direct materials |
|
|
|
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Part 3
a. | Direct materials price variance, based on purchases, is |
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Part 4
b. | The direct materials efficiency variance is |
|
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Part 5
Now complete the table for direct labor.
| Actual Costs Incurred | Actual Input Quantity Budgeted Price | Flexible Budget |
---|---|---|---|
Direct Manufacturing Labor |
|
|
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Part 6
c. | The direct manufacturing labor price variance is |
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Part 7
d. | The direct manufacturing labor efficiency variance is |
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Part 8
Next, complete the table for variable overhead.
| Actual Costs Incurred | Actual Input Quantity Budgeted Price | Flexible Budget | Allocated Overhead |
Variable Manufacturing Overhead |
|
|
|
|
---|
Part 9
Finally, complete the table for fixed overhead.
| Actual Costs Incurred | Same Budgeted Lump Sum Regardless of Output Level | Flexible Budget | Allocated Overhead |
---|---|---|---|---|
Fixed Manufacturing Overhead |
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Part 10
e. | The total manufacturing overhead spending variance is |
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Part 11
f. | The variable manufacturing overhead efficiency variance is |
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Part 12
g. | The production-volume variance is |
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